Global Hydrogen Review 2024

Hydrogen demand

Highlights

  • Global hydrogen demand reached more than 97 Mt in 2023 and could reach almost 100 Mt in 2024. However, this increase should be seen as a consequence of wider economic trends rather than the result of successful policy implementation.
  • Hydrogen demand remains concentrated in refining and industry applications, where it has been used for decades. Its adoption in new applications where hydrogen should play a key role in the clean energy transition – heavy industry, long-distance transport and energy storage – accounts for less than 1% of global demand, despite 40% growth compared with 2022.
  • Demand for low-emissions hydrogen grew almost 10% in 2023, but still accounts for less than 1 Mt. Government action has intensified recently, through implementation of mandates, incentive schemes and market development tools. This could boost demand to over 6 Mtpa by 2030, although this would equal around one-tenth of the needs of the Net Zero Emissions by 2050 Scenario (NZE Scenario).
  •  Industry is responding to these policy efforts and signing a growing number of offtake agreements. Moreover, these agreements are moving from Memoranda of Understanding to firm contractual arrangements. Chemical, refining and the shipping sectors present the largest amount of contracted demand, as well as the largest share of firm agreements.
  • Industry is also making other efforts to facilitate uptake, such as tenders and co-operative initiatives for demand aggregation of hydrogen and hydrogen-based fuels and feedstocks.
  • Several large-scale projects for the production of low-emissions hydrogen for use in refining, chemicals production and steel manufacturing reached final investment decisions (FID) last year. The committed projects in these sectors could lead to a demand for 1.5 Mtpa of low-emissions hydrogen by 2030, 3 times more than today.
  • There are contrasting trends in different transport subsectors. In road transport, the market is slowing down, with the focus shifting from cars to heavy-duty vehicles. In shipping and aviation, the use of hydrogen and hydrogen-based fuels is gaining interest, especially where policy support is in place, though slow market penetration has led to the cancellation of some ambitious projects for the supply of these fuels.
  • In the power sector, progress is particularly strong in Japan and Korea, where companies are moving forward with several major demonstrations, and the governments have established the first auctions for hydrogen and ammonia-based electricity generation. 
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